A hybrid card reader is a card reader that can read a magnetic stripe card, a smart card (also referred to as an integrated circuit card), and a combined magnetic stripe and smart card. To read a magnetic stripe, the stripe must move relative to a magnetic read head; however, to read a smart card having conducting terminals, the card terminals must align, make contact, and remain in contact with terminals used for reading the smart card.
A dip card reader is a reader that does not have any transport mechanism for automatically transporting a card (unlike a motorized card reader/writer), but a dip reader does receive and support an inserted card (unlike a swipe card reader). To use a dip reader, a user must manually insert his/her card, typically short edge first, and then manually remove the card.
A hybrid dip card reader typically comprises a housing having a guide portion extending therefrom. The guide portion is generally u-shaped, defines recesses for receiving opposite long edges of a card, and includes a magnetic read head. The housing contains pivoting read/write smart card terminals that are lowered by a leading edge of an inserted card so that when the card has been fully inserted the read/write terminals align with and contact the card terminals on the card.
Hybrid dip card readers are used in apparatus, such as an automated teller machine (ATM), where a user may insert a magnetic stripe card, a smart card, or a combined magnetic stripe and smart card to conduct a transaction.
Unauthorized reading of card data, such as data encoded on a magnetic stripe of an ATM card, while the card is being used (“card skimming”), is a known type of fraud. In the context of dip card readers on ATMs, card skimming is typically perpetrated by adding a magnetic read head (“unauthorized reader”) to a the guide portion of the card reader to read a magnetic stripe on a customer's card as the customer inserts or (more commonly) retrieves the card from an ATM.
An ATM may include a skimmer detection circuit to detect if a card skimmer has been added. However, even if the ATM turns off the card reader, a customer may still insert his/her card into the dip reader. When the card is removed, the unauthorized reader will have read the customer's card.